Rights Defense Network Policy and Legislation Review: Draft Revision to the Law on the Administration of Tax Collection Open for Public Comment—Major Overhaul of the Tax Collection Law: Paper Rights Cannot Conceal Deep-Seated Fault Lines in Unbalanced Enforcement

Special Commentator: Zhang Haoran

On November 6, 2026, the Law of the People’s Republic of China on the Administration of Tax Collection (Draft Revision) was released for public comment after its first review at the 25th session of the Standing Committee of the 14th National People’s Congress. The deadline for comments is December 5. The draft has six chapters and 100 articles. While improving tax collection and administration measures, it strengthens protections for taxpayers’ rights and interests, stipulates that enforcement measures against individuals may not involve entering their homes, requires that essential living necessities for their dependents be retained, caps late payment surcharges at twice the amount of tax owed, and strictly protects the confidentiality of tax-related information. The draft also sets out provisions on online platforms’ tax-related assistance obligations and recovery of tax from investors. The public may submit comments online or send them in writing to the Legislative Affairs Commission of the Standing Committee of the National People’s Congress. (For details, see: http://www.npc.gov.cn/flcaw/index.html )

Review: Major Overhaul of the Tax Collection Law:Paper Rights Cannot Conceal Deep-Seated Fault Lines in Unbalanced Enforcement

Guanzi said: “Take from the people in moderation, and spend with restraint, and even a small state will be secure; take without limit and spend without restraint, and even a great state will be in danger.” The full text of the draft revision to the Law on the Administration of Tax Collection was recently released for public comment. Public discussion has focused largely on provisions such as “may not enter an individual’s home” and “a cap on late payment surcharges,” praising them as milestones in protecting taxpayers’ rights and interests. Yet a close examination of the full text from the perspective of human rights protection reveals that beneath the progress on paper lie numerous institutional shortcomings that remain unaddressed. The affirmation of rights is welcome, but if boundaries are vague, procedures are disorderly, and remedies are lacking, even the most striking provisions will ultimately risk being diluted in enforcement practice and reduced to a beautiful-looking castle in the air.

It is undeniable that this revision does add protections for taxpayers’ rights. Explicitly prohibiting enforcement from entering citizens’ homes gives concrete effect to the constitutional right to residential privacy and draws a clear line between public power and private space. Requiring that housing and necessities essential to the lives of the person subject to enforcement and their dependents be retained safeguards the minimum protection for citizens’ right to survival and prevents tax enforcement from becoming a harsh policy that drives people into desperate straits. The provision that late payment surcharges may not exceed twice the principal amount of tax puts an end to the previously frequent chaos of “sky-high late payment surcharges” and directly reflects the principle of proportionality in the tax field. The provisions strictly protecting the confidentiality of tax-related information also respond to widespread public concerns about personal privacy in the age of big data. These changes bring a measure of human warmth to a cold tax collection system and are an essential part of progress under the rule of law. They deserve recognition.

But the light of progress cannot conceal the deep-seated concerns in the institutional design. Measured against substantive standards for human rights protection, many provisions of the draft remain crude, overly broad, and weak. Rights protections that appear comprehensive in fact leave gaps that can be breached at every turn.

Foremost is the ambiguity of the prerequisite “a large amount of unpaid taxes.” The draft stipulates that enforcement may be imposed on an individual only when the amount of unpaid taxes is large. This appears to raise the threshold for enforcement, but the text provides no quantitative standard or judicial interpretation of what constitutes a “large amount.” Does that mean 100,000 or one million? Does the same yardstick apply across different regions and income groups? The lack of clarity effectively hands the power to interpret the rules entirely to front-line enforcement personnel. The red line around residential rights, which should be firm, thus becomes an elastic band that can be tightened or loosened at will. When the boundaries of a basic citizen right depend on the discretion of enforcement officers, the right itself is already on shaky ground. Han Feizi once said: “The law does not favor the noble; the plumb line does not bend to the crooked.” The vitality of law lies in clarity. Once standards become vague, public power gains room for manipulation. The same unlawful conduct may produce vastly different outcomes in different places and at the hands of different enforcement officers, making the human rights principle of equal application of the law impossible to uphold.

A deeper problem is the lack of judicial checks on enforcement procedures. Under the draft, tax authorities need only internal approval to initiate enforcement against an individual citizen, and may even use measures such as seizure, impoundment, and freezing that directly affect citizens’ property rights, without prior review and authorization by a judicial authority. This means that the tax department, as an administrative agency, acts as both referee and player: it makes the tax decision and approves its own enforcement. Faced with powerful administrative authority, citizens have virtually no opportunity to present a defense in advance. A basic principle of the modern rule of law is that restrictions on or deprivation of citizens’ basic rights must be decided by an impartial judicial authority. Without the firewall of judicial review, administrative tax collection and administration powers become like a runaway horse; basic human rights such as property rights and residential rights may be violated at any time in the name of “recovering taxes.” A Western legal saying holds that remedies precede rights. Without fair procedural safeguards, even the most appealing substantive rights are water without a source and a tree without roots.

Meanwhile, the expansion of platforms’ tax assistance obligations also creates risks for personal information rights. The draft explicitly requires internet platforms to report tax-related information and assist tax authorities in big data risk management, but it does not set strict, workable rules on the scope of information collection, the limits on its use, or accountability for leaks. In the digital economy, platforms hold vast amounts of citizens’ data on consumption, travel, transactions, and even social interactions. If tax-related data are connected without barriers to other personal data, citizens’ privacy will be laid bare. More troubling, the draft emphasizes platforms’ reporting obligations but does not grant citizens corresponding rights to know and object. Individuals cannot even find out what information about them has been accessed or how it is being used, let alone seek a remedy. Privacy is a core component of human rights in the digital age. Prioritizing tax collection efficiency while neglecting information protection is like picking up sesame seeds and losing the watermelon; ultimately, it is the digital human rights of all citizens that suffer.

More regrettably, this revision does not address the long-criticized institutional flaw of “pay tax first, then seek administrative reconsideration.” Under current rules, if taxpayers object to a tax decision, they must first pay the tax or provide corresponding security before they can apply for administrative reconsideration; only if they are dissatisfied with the reconsideration result may they file a lawsuit. This directly ties the right to a remedy to property rights. Taxpayers who are short of money may be deprived of the right to defend themselves because they cannot afford to pay, even when the tax decision is clearly wrong. This is, in essence, a double infringement of citizens’ rights to equality and remedy, and amounts to endorsing the absurd logic that “justice is for those who can pay.” The ancients said, “A prince who breaks the law is as guilty as a commoner.” Yet under such rules, differences in wealth directly determine whether rights exist, and the principle of equality before the law fades in the face of the tax payment threshold. It is a serious shortcoming that a draft revision whose highlight is protecting taxpayers’ rights and interests turns a blind eye to this high wall blocking access to remedies.

In addition, the broadening of joint and several recovery from investors exposes citizens’ property rights to the risk of collective liability. The draft stipulates that if an investor fails to fulfill capital contribution obligations, withdraws funds, or deregisters in violation of regulations, making it impossible to recover taxes, the tax authorities may recover them directly from the investor. This institutional design is intended to combat malicious tax evasion, but it does not specify the elements of fault or the boundaries of its application. What constitutes withdrawal of funds? What constitutes deregistration in violation of regulations? Does it apply only to actual controllers who maliciously evade taxes, or are all investors jointly liable? Vague rules can easily lead to an unlimited expansion of the scope of liability, saddling small and medium-sized investors who are not at fault with a company’s tax debts. A basic principle of the modern rule of law is that individuals bear their own responsibility and that collective punishment is rejected. Requiring people to cover a company’s tax debts solely because they hold shares would undoubtedly unduly infringe on individuals’ lawful property rights and run counter to the current policy direction of encouraging innovation and entrepreneurship.

To be fair, this revision to the Law on the Administration of Tax Collection is not without measures to protect human rights; many provisions reflect the legislative direction of constraining public power and protecting private rights. But we must recognize clearly that human rights protection has never been achieved through a few statements of principle. It requires clear boundaries, rigorous procedures, accessible remedies, and firm accountability. If the revision focuses on writing substantive rights into the law but not on detailing procedural rules; on improving the efficiency of tax collection and administration but not on checking public power against citizens’ rights; and on superficial institutional additions but not on addressing deep-rooted systemic flaws, then even the best legislative intentions will inevitably risk being distorted in practice.

The Zhenguan Zhengyao says: “Governing a country is like planting a tree: when its roots remain firm, its branches and leaves flourish.” The root of taxation has never been to extract as much wealth as possible, but to achieve a balance between public and private rights within the framework of the law. Only by truly placing taxpayers’ basic human rights first, keeping power in the cage of institutions, and ensuring that every enforcement action has clear boundaries and every right has a channel for remedy can a revision to the Tax Collection Law qualify as good law and truly win public trust and compliance.